On Marketing, Real Estate, and Technology

One Reason Realtors Will NEVER Get Web 2.0

January 29, 2008

I was on a call earlier today with a client of my employer (who does not authorize this blog, nor have anything whatsoever to do with it — all opinions are my own, blah, blah and blah) talking about a particular product we carry that could assist them with some of their online marketing efforts. They ask questions, we answer them. We hope they’ll buy from us, but at the same time, I really don’t want to sell something that the customer can’t use.

In any event, during the call, the client asks, “So, can we choose to exclude certain data from the report your tool generates?”

Normally, people buying data tend to want to have more, not less data. Thus with my interest piqued, I ask why.

“There’s some stuff we just don’t want in there, like y’know… crime stats, and bad school ratings.”

I realized these guys will never, ever get Web 2.0. For that matter, I’m not entirely sure that they get Web 1.0. And they’ve got the blogs, the podcasts, the video, the user-generated-content and the whole nine yards. All the trappings of Web 2.0, none of the soul.

Web 2.0 means a whole lot of things. Oftentimes, it means a string of buzzwords strung together. But one of the roots of the whole concept of Web 2.0 lies in something called the Cluetrain Manifesto. If you care at all about marketing as a topic, you owe it to yourself to read that in full, but this passage captures the central insight:

Most corporations, on the other hand, only know how to talk in the soothing, humorless monotone of the mission statement, marketing brochure, and your-call-is-important-to-us busy signal. Same old tone, same old lies. No wonder networked markets have no respect for companies unable or unwilling to speak as they do.

But learning to speak in a human voice is not some trick, nor will corporations convince us they are human with lip service about “listening to customers.” They will only sound human when they empower real human beings to speak on their behalf.

While many such people already work for companies today, most companies ignore their ability to deliver genuine knowledge, opting instead to crank out sterile happytalk that insults the intelligence of markets literally too smart to buy it.

Replace the words “corporations” and “companies” with “Realtors” and I think you have a pretty good summary of the state of real estate marketing today on the part of the vast majority of the industry.

What is it about Realtors that makes them think that they alone can defeat the power of the Internet? That they alone can somehow control information and prevent its leaking to the public? They couldn’t seriously believe that crime statistics are somehow only available through their website, which isn’t ranked even in the Top 100,000 websites in reach, traffic, or usage on any traffic measurement service… could they?

Hiding unfavorable information is not only pointless — since any consumer worth a damn is going to research the house or neighborhood — but counterproductive. Because it erodes trust. Once trust is gone, really… what do you have left? Shiny brochures?

The real estate industry has to wake up and realize that yes, even for them, the Internet changes everything.

Let’s face it. Consumers are going to find out that the neighborhood you’re trying to peddle is a crime-ridden shithole. They’re going to learn that the school system is overcrowded, filled with underperforming kids and unmotivated teachers. They’re going to find out that the “up-and-coming” area that you spoke of so glowingly is neither up nor coming, but only going and faster that ever. Thing is, they’re going to learn all this from someone else.

That someone else could be a real estate megasite, like a Trulia or Zillow, or it could be a dedicated blogger who doesn’t particularly care about commissions since he isn’t a Realtor. It could be a community message board, or Facebook user group.

Whoever it is, the consumer will be trusting… well, not you. And since you’ve chosen to obfuscate on things like crime data and schools, why should they believe you when you tell them the property is a fantastic buy?

I’m not entirely pessimistic. I’m sure there are realtors out there who truly believe that the best way to serve their clients (whether seller or buyer) is to cut out the bullshit from day one. That could mean telling the seller, “Hey, this neighborhood sucks — you might need to drop the price a lot more than that.” My view is… those guys are going to end up owning everyone else who are addicted to the spin of selling.

Oh I know — realtors love to point to Fair Housing laws as the excuse why they can’t tell consumers what they want to know, and will find out despite the best efforts of the real estate industry. But that’s just an excuse. You really don’t want to take the risk? Just tell the clients, “I can’t tell you jack, but the FBI crime statistics can be found at http://www.fbi.gov&#8221; and handle it that way.

Point is, the Realtor community has got to understand at some point that they need to start getting real with the consumers. At this stage of the industry, I think it’s very fair to say that most consumers are better educated and better informed than most Realtors are. They’re engaged in the most expensive purchase of their entire lives. They’ll do the research. They’ll find out.

In my book, seems like it’d be better that they find out from the person who claims to be the expert.